What is the main purpose of the repo rate fixed by the Reserve Bank of India?
Solution
✅ Correct Option: 3
The **repo rate** is the rate at which the RBI lends short-term money to banks against eligible securities. By changing it, the RBI can influence bank borrowing costs, credit conditions and **liquidity in the banking system**. **Option 1:** Minimum wages come under **labour law and government wage policy**, not RBI monetary policy. **Option 2:** **SEBI regulates the securities market**, but share prices are set by buyers and sellers in the market. **Option 4:** The **fiscal deficit** is the government's budget gap and is managed mainly through taxation and government spending.
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BBA-DBE Bangalore 2026
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